Asian stocks are down on Monday after UBS reached an agreement to acquire Credit Suisse. ING economists said a relief recovery is possible after Switzerland took steps to contain the banking crisis. Investors are still awaiting the Fed’s interest rate decision this week for other clues. Something is loading.
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Asian stocks are down slightly early Monday after Swiss-based UBS reached a deal to take over peer Credit Suisse. The deal values Credit Suisse at approximately $3.25 billion.
The development in Europe came after a crazy week for the banking sector – Silicon Valley Bank was shut down by regulators on March 10, sparking jitters of a contagion that could lead to a wider economic crisis.
The Japanese Nikkei 225 was down 0.7% at last check, while the Korean Kospi edged down 0.2%. Australia’s ASX200 was down 0.9% and the Shanghai Composite Index was up 0.2%.
Hong Kong’s Hang Seng index fell far more than other Asia-Pacific indexes – posting 2% losses in its first hour of trading on Monday – but the index came under pressure from the slow China’s economic recovery after the country lifted zero-Covid restrictions in January.
S&P 500 futures were up 0.4%.
Bitcoin is up 21.45% in the past 24 hours and is now trading above $27,600, according to CoinMarketCap.
Markets could rise on the relief Switzerland took to prevent the banking crisis from spreading over the weekend, ING economists Robert Carnell and Iris Pang said Monday in a note seen by Insider.
Investors will also carefully watch the Federal Reserve’s decision on interest rates for other indices, according to ING economists. The Fed is due to meet Tuesday and Wednesday. The central bank’s decision is being watched closely as a year of aggressive interest rate hikes dampened equity markets.
“The initial reaction of financial banks in the region to the takeover of Credit Suisse by UBS seems to point to more measured gains, suggesting a still cautious environment as sentiments remain on hold for further developments in the banking space,” Yeap wrote. Jun Rong. , market strategist at IG, an online trading platform in a Monday note.